Research on knowledge sharing and the role of ICT in the Dutch greenhouse region
Marleen Huysman, Erik Stam, Jaap Rooijen,Alexander van der Flier, Tanja Krauze , Vrije Universiteit, The Netherlands
Abstract
The conquering of distance in electronic terms with the communications revolution brought for many the dream of low cost and efficient access to people and information worldwide (Cairncross, 1997). The death of distance is, however, not fulfilled (yet) due to many unforeseen problems with Net-Enabled Forms of Organizing. Almost the opposite seem to be true for the competitive position of firms: the most enduring competitive advantages in a global economy seem to be local (Porter 2000, p.32).
In this research, we will explore the value of both Porter assumption about regional clusters and assumptions hold by various internet enthusiasts, and in particular those advocating the value of e-business and B to B marketplaces for inter-firm cooperation.
The research uses the Dutch agricultural region in the south west of the Netherlands: the ‘glastuinbouw’ (greenhouse farming sector). In this region, thousands of small, medium and large farms cultivate and garden agricultural products, mainly vegetables, plants and flowers. The region is geographically situated at close proximity from the main auction in the city of Naaldwijk. In the last decade quite a number of firms have left to restart in other areas within the Netherlands and in other European countries, most notably in Spain. This geographic mobility is mainly a result of the limited geographic space in the region.
The research has two related projects. One project focus on the role of electronic networks to enhance the knowledge sharing between firms within the regional cluster. The assumption is that the value of electronic networks within regional inter-firm clusters is limited due – to a large extent - to a combined effect of social and physical proximity. The main research question that guides this project, is “To what extent do electronic networks enhance knowledge sharing between firms in a regional cluster?”
Clusters of economic activities have become an interesting object of research as firms in those clusters appear to have a competitive advantage because of their social capital. A cluster can be seen as relatively closed networks dominated by strong ties. The benefits boil down to ease of knowledge sharing and knowledge generation. The question is whether ICT or inter-organizational information systems are able to change the social dynamics of regional clusters.
This research question is studied by analysing various levels of networks within the regional inter-firm cluster:
- small co-optation networks consisting of 3 to 10 small firms (study-groups or inter-firm communities);
- network organizations or institutionalised network of firms within a particular field;
- region as a network.
In order to study the potential role of ICT in supporting knowledge sharing between firms, we will also study negative cases: firms that have left the region to establish their business outside the cluster. If indeed physical and social proximity is important for bonding the firms as a geographic cluster, what will happen if firms decide to leave the cluster? Theoretical considerations lead to opposing effects. First, as trust and proximity are important ingredients in the functioning of clusters, one may expect that the members who leave the cluster to set up their firm in other regions/countries are lost for the cluster. Proximity is lost and because of the distances involved it is relatively difficult to cooperate and the flexibility in coordinating joint activities is also reduced. Thus these ‘far away’ firms are much more difficult to fit in smoothly into the flexible production system as is often referred to as one of the characteristics of a cluster. At the same time this ‘far away’ firm can still benefit from the ‘knowledge’ in the cluster concerning production technologies. An opposing perspective can be derived from the network characteristics of these cluster with ties to other regions. Firms in such a network can much more easily benefit from structural holes (Burt 1995), as these ties to the outside world provide connections to new sources of information. Also these ‘outside’ firms may have to develop new combinations to satisfy local customers. These new combinations may turn out to be innovations which may be of use for the firms in the core of the cluster as well. Thus from this ‘Burt’ type of perspective we may expect that this proliferation will strengthen the innovative potential of the cluster. In this study we will examine which of the two perspective has the most potential to understand and explain the development of the particular Dutch agricultural cluster.
The research is mainly explorative and will be based on open interviews with various people within the region. The research started in the beginning of 2003. At this moment we have conducted more than 15 interviews with network organizations, individual farmers and people working at the auction. These interviews already provided insights in the social dynamics of the particular regional cluster.
Clearly, at the moment of writing, it is too early to discuss these insights as being results. Some insights however illustrate the dynamics that we encounter. For example, because breeding plants and vegetables is a highly complex activity, most individual farmers are member of one or two ‘studygroups’ or inter-firm communities. These studygroups are formed spontaneously around a particular field of expertise: e.g. a particular type of breeding technique or a particular type of flowers or tomato’s. In these studygroups individual firms share knowledge about the complex breeding process with each other. Although the individual farmers are in principle each other competitors, they seemed to have find a modus operandus that balance competition and cooperation. Although such ‘cooptation communities’ are almost common practice in the agricultural industry, not much academic research have been done on the dynamics that keeps the balance between the two opposing forces.
Some of these ‘study-groups’ make use electronic means to share their knowledge about their individual activities. In particular, they use ‘Groeinet’, which offers intranets for study-groups to share information about the details of the breeding process, such as the amount of light, gas, water, but also individual commercial figures. Every week, updates of these bundles of business information is shared among the community members. At the moment of writing, we are exploring in more depth what motivates people to share such seemingly competitive information. We are also interested in the long-term effect of these intranets on the value of the physical and social proximity that is believed to hold the regional community together. For example, in one of the study-groups that we studied, two members moved away from the regional area to set up a new business in other parts in the Netherlands. We will explore whether their move will decrease the social capital or whether the use of ‘groeinet’ will help to remain a ‘perceived full member’ . Also, we will analyse if the regional cluster in the South West of the Netherlands will perhaps benefit from this ‘outsider’ by bridging structural holes (Burt 1995).
Literature
Burt, Ronald S. 1995. Structural Holes: The Social Structure of Competition. Harvard University Press, paper back edition
Cairncross, F. (1997) The death of distance. Boston, MA: Harvard Business School Press.
Porter, M. (2000). Location, competition, and economic development: Local clusters in a global economy. Economic Development Quarterly, 14 (1), 15-34